[House Report 108-768]
[From the U.S. Government Publishing Office]



108th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     108-768

======================================================================
 
                   PROGRAM ASSESSMENT AND RESULTS ACT

                                _______
                                

October 8, 2004.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

  Mr. Tom Davis of Virginia, from the Committee on Government Reform, 
                        submitted the following

                              R E P O R T

                             together with

                             MINORITY VIEWS

                        [To accompany H.R. 3826]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Government Reform, to whom was referred the 
bill (H.R. 3826) to require the review of Government programs 
at least once every 5 years for purposes of evaluating their 
performance, having considered the same, report favorably 
thereon with an amendment and recommend that the bill as 
amended do pass.

                                CONTENTS

                                                                   Page
Committee Statement and Views....................................     4
Section-by-Section...............................................     8
Explanation of Amendments........................................    10
Committee Consideration..........................................    10
Rollcall Votes...................................................    11
Application of Law to the Legislative Branch.....................    12
Statement of Oversight Findings and Recommendations of the 
  Committee......................................................    12
Statement of General Performance Goals and Objectives............    12
Constitutional Authority Statement...............................    12
Federal Advisory Committee Act...................................    12
Unfunded Mandate Statement.......................................    12
Committee Estimate...............................................    12
Budget Authority and Congressional Budget Office Cost Estimate...    13
Changes in Existing Law Made by the Bill as Reported.............    13
Minority Views...................................................    17
  The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Program Assessment and Results Act''.

SEC. 2. FINDINGS.

  Congress finds that--
          (1) inefficiency and ineffectiveness in Federal programs 
        undermines the confidence of the American people in the 
        Government and reduces the Federal Government's ability to 
        adequately address vital public needs;
          (2) insufficient information on program performance seriously 
        disadvantages Federal managers in their efforts to improve 
        program efficiency and effectiveness;
          (3) congressional policy making, spending decisions, and 
        program oversight are handicapped by insufficient attention to 
        program performance and results;
          (4) programs performing similar or duplicative functions that 
        exist within a single agency or across multiple agencies should 
        be identified and their performance and results shared among 
        all such programs to improve their performance and results;
          (5) advocates of good government continue to seek ways to 
        improve accountability, focus on results, and integrate the 
        performance of programs with decisions about budgets;
          (6) with the passage of the Government Performance and 
        Results Act of 1993, the Congress directed the executive branch 
        to seek improvements in the effectiveness, efficiency, and 
        accountability of Federal programs by having agencies focus on 
        program results; and
          (7) the Government Performance and Results Act of 1993 
        provided a strong framework for the executive branch to monitor 
        the long-term goals and annual performance of its departments 
        and agencies.

SEC. 3. PURPOSE.

  The purposes of this Act are--
          (1) to improve the Government Performance and Results Act of 
        1993 by implementing a program assessment and evaluation 
        process that attempts to determine the strengths and weaknesses 
        of Federal programs with a particular focus on the results 
        produced by individual programs;
          (2) to use the information gathered in the assessment and 
        evaluation process to build on the groundwork laid in the 
        Government Performance and Results Act of 1993 to help the 
        executive branch make informed management decisions and 
        evidence-based funding requests aimed at achieving positive 
        results; and
          (3) to provide congressional policy makers the information 
        needed to conduct more effective oversight, to make better-
        informed authorization decisions, and to make more evidence-
        based spending decisions that achieve positive results for the 
        American people.

SEC. 4. PROGRAM ASSESSMENT.

  (a) Requirement for Program Assessments.--Chapter 11 of title 31, 
United States Code, as amended by the Government Performance and 
Results Act of 1993, is amended by adding at the end the following new 
section:

``Sec. 1120. Program assessment

  ``(a) Assessment.--The Director of the Office of Management and 
Budget to the maximum extent practicable shall conduct, jointly with 
agencies of the Federal Government, an assessment of each program at 
least once every 5 fiscal years.
  ``(b) Assessment Requirements.--In conducting an assessment of a 
program under subsection (a), the Director of the Office of Management 
and Budget and the head of the relevant agency shall--
          ``(1) coordinate to determine the programs to be assessed; 
        and
          ``(2) evaluate the purpose, design, strategic plan, 
        management, and results of the program, and such other matters 
        as the Director considers appropriate.
  ``(c) Criteria for Identifying Programs to Assess.--The Director of 
the Office of Management and Budget shall develop criteria for 
identifying programs to be assessed each fiscal year. In developing the 
criteria, the Director shall take into account the advantages of 
assessing during the same fiscal year any programs that are performing 
similar functions, have similar purposes, or share common goals, such 
as those contained in strategic plans under section 306 of title 5. To 
the maximum extent possible, the Director shall assess a representative 
sample of Federal spending each fiscal year.
  ``(d) Criteria for More Frequent Assessments.--The Director of the 
Office of Management and Budget shall make every effort to assess 
programs more frequently than required under subsection (a) in cases in 
which programs are determined to be of higher priority, special 
circumstances exist, improvements have been made, or the head of the 
relevant agency and the Director determine that more frequent 
assessment is warranted.
  ``(e) Publication.--At least 90 days before completing the 
assessments under this section to be conducted during a fiscal year, 
the Director of the Office of Management and Budget shall--
          ``(1) make available in electronic form through the Office of 
        Management and Budget website or any successor website, and 
        provide to the Committee on Government Reform of the House of 
        Representatives and the Committee on Governmental Affairs of 
        the Senate--
                  ``(A) a list of the programs to be assessed during 
                that fiscal year; and
                  ``(B) the criteria that will be used to assess the 
                programs; and
          ``(2) provide a mechanism for interested persons to comment 
        on the programs being assessed and the criteria that will be 
        used to assess the programs.
  ``(f) Report.--(1) The results of the assessments conducted during a 
fiscal year shall be submitted in a report to Congress at the same time 
that the President submits the next budget under section 1105 of this 
title after the end of that fiscal year.
  ``(2) The report shall--
          ``(A) include the performance goals for each program 
        assessment;
          ``(B) specify the criteria used for each assessment;
          ``(C) describe the results of each assessment, including any 
        significant limitation in the assessments;
          ``(D) describe significant modifications to the Federal 
        Government performance plan required under section 1105(a)(28) 
        of this title made as a result of the assessments; and
          ``(E) be available in electronic form through the Office of 
        Management and Budget website or any successor website.
  ``(g) Classified Information.--(1) With respect to program 
assessments conducted during a fiscal year that contain classified 
information, the President shall submit on the same date as the report 
is submitted under subsection (f)--
          ``(A) a copy of each such assessment (including the 
        classified information), to the appropriate committees of 
        jurisdiction of the House of Representatives and the Senate; 
        and
          ``(B) consistent with statutory law governing the disclosure 
        of classified information, an appendix containing a list of 
        each such assessment and the committees to which a copy of the 
        assessment was submitted under subparagraph (A), to the 
        Committee on Government Reform of the House of Representatives 
        and the Committee on Governmental Affairs of the Senate.
  ``(2) Upon request from the Committee on Government Reform of the 
House of Representatives or the Committee on Governmental Affairs of 
the Senate, the Director of the Office of Management and Budget shall, 
consistent with statutory law governing the disclosure of classified 
information, provide to the Committee a copy of--
          ``(A) any assessment described in subparagraph (A) of 
        paragraph (1) (including any assessment not listed in any 
        appendix submitted under subparagraph (B) of such paragraph); 
        and
          ``(B) any appendix described in subparagraph (B) of paragraph 
        (1).
  ``(3) In this subsection, the term `classified information' refers to 
matters described in section 552(b)(1)(A) of title 5.
  ``(h) Inherently Governmental Functions.--The functions and 
activities authorized or required by this section shall be considered 
inherently Governmental functions and shall be performed only by 
Federal employees.
  ``(i) Termination.--This section shall not be in effect after 
September 30, 2013.''.
  (b) Guidance.--Not later than 6 months after the date of the 
enactment of this Act, the Director of the Office of Management and 
Budget shall prescribe guidance to implement the requirements of 
section 1120 of title 31, United States Code, as added by subsection 
(a), including guidance on a definition of the term ``program''.
  (c) Conforming and Clerical Amendments.--
          (1) Section 1115(g) of title 31, United States Code, is 
        amended by striking ``1119'' and inserting ``1120''.
          (2) The table of sections at the beginning of chapter 11 of 
        title 31, United States Code, is amended by adding at the end 
        the following:

``1120. Program assessment.''.

SEC. 5. STRATEGIC PLANNING AMENDMENTS.

  (a) Change in Deadline for Strategic Plan.--Subsection (a) of section 
306 of title 5, United States Code, is amended by striking ``No later 
than September 30, 1997,'' and inserting ``Not later than September 30 
of each year following a year in which an election for President 
occurs, beginning with September 30, 2005, ''.
  (b) Change in Period of Coverage of Strategic Plan.--Subsection (b) 
of section 306 of title 5, United States Code, is amended to read as 
follows:
  ``(b) Each strategic plan shall cover the 4-year period beginning on 
October 1 of the year following a year in which an election for 
President occurs.''.

                     Committee Statement and Views


                          PURPOSE AND SUMMARY

    The main purpose of the Program Assessment and Results 
(PAR) Act is to improve the Government Performance and Results 
Act (GPRA) of 1993, P.L. 103-62, by implementing a program 
review and evaluation process that attempts to determine the 
strengths and weaknesses of Federal programs with a particular 
focus on the results produced by individual programs. 
Furthermore, the information gathered in the review and 
evaluation process established by the PAR Act will build on the 
groundwork laid by GPRA to help the executive branch make 
informed management decisions and evidence-based funding 
requests aimed at achieving positive results. Finally, the 
program reviews created by the PAR Act will provide 
congressional policy makers with the information needed to 
conduct more effective oversight, to make better-informed 
authorization decisions, and to make more evidence-based 
spending decisions that achieve positive results for the 
American people.
    The PAR Act amends GPRA to require the Director of the 
Office of Management and Budget (OMB) to review each Federal 
program, as defined by OMB, at least once every five fiscal 
years. The choice of a five-year cycle divides the workload of 
evaluating all Federal programs into manageable segments for 
OMB. Attempting to evaluate the performance of all Federal 
programs in one year was a major impediment to the success of 
past attempts at performance measurement by previous 
Administrations. The five year cycle also parallels the time 
frame used by OMB in its Program Assessment Rating Tool (PART), 
which OMB has used to evaluate programs, representing 20% of 
all Federal spending each year beginning with the fiscal year 
2003 budget cycle. The PAR Act does not interfere with OMB's 
timeline for using PART to complete program assessments of each 
program in the Federal budget, nor does the PAR Act attempt to 
codify the specific methodology used by PART. Instead, the PAR 
Act directs OMB to conduct reviews of programs in consultation 
with the relevant agency that administers the program and to 
evaluate each program's purpose, design, strategic plan, 
management, results, and any other matters that OMB considers 
appropriate.
    As OMB develops its criteria for which programs to review 
each fiscal year, the PAR Act requires OMB to take into account 
the advantages of reviewing program activities with similar 
functions or purposes during the same fiscal year. The intent 
of this language is to ensure that the functions of government 
that cut across several programs and potentially cut across 
several agencies are reviewed at the same time. This 
information can then be used to compare the performance of 
programs against one another and to seek managerial and budget 
changes that capitalize on the best practices of the programs 
that are most successful in achieving the outcomes they were 
designed to achieve. In addition to considering the 
crosscutting nature of government functions, the PAR Act also 
directs OMB to review program activities more frequently than 
every five fiscal years in cases in which programs are 
determined to be of higher priority, special circumstances 
exist, improvements have been made, or the head of the relevant 
agency and OMB determine that more frequent review is 
warranted. Requiring more frequent reviews in these 
circumstances will ensure that the lessons learned from 
programs that make improvements may be cultivated more 
frequently and that programs that continually fail to achieve 
their goals will be scrutinized more closely.
    The results of program reviews conducted under the PAR Act 
will be reported to Congress with the President's next budget 
following the end of the fiscal year in which the program 
reviews were conducted. OMB currently uses this method of 
reporting in conjunction with the PART. The Committee is 
pleased with the high level of transparency that OMB has 
exhibited in reporting the results of the programs that have 
been evaluated using the PART. In an effort to maintain this 
level of transparency under the PAR Act, the Act requires that 
OMB make every effort to ensure the transparency of the report. 
For any program reviewed, OMB should publish the information 
necessary for the public to understand what methods were used 
to evaluate the program, what information was derived from the 
application of those methods to the program, and what 
conclusions were drawn from the information derived. There is 
some concern that the PART has been unable to complete 
evaluations for 152 of the 407 programs--37.1% of the 
programs--to which it has been applied over the two-year period 
in which assessments were conducted. Although the percentage of 
programs receiving a score of ``results not demonstrated'' 
decreased in year two, it remains too high. We encourage OMB 
and the agency community to work to continue to refine the 
evaluation criteria to ensure meaningful reporting for all 
federal programs, including those programs administered 
cooperatively among state and local stakeholders.
    Finally, the bill will move the due date for submitting 
strategic plans under GPRA to September 30 of each year 
following a presidential election and would change the duration 
of the coverage of the plans from 5 years to 4 years. These 
changes would improve the usefulness and timeliness of 
strategic plans by giving the management team of the most 
recently elected President enough time to assemble and set its 
goals for the President's term.

                Background and Need for the Legislation

    The Government Performance and Results Act (GPRA) of 1993, 
P.L. 103-62, has laid a solid foundation for agencies working 
with Congress to set strategic goals and begin to utilize 
performance-based information. Building on GPRA, Congress must 
take the next step toward reforming the way the government 
conducts its business.
    Prior efforts to make the Federal government more 
effective--the Hoover Commission, Zero-Based Budgeting, the 
Planning-Programming-Budgeting System, and Reinventing 
Government--have come and gone with little lasting effect. 
Federal managers have learned that if they wait, each new 
Administration is likely to attempt yet another broad-based 
reform. From a management standpoint, it is difficult in that 
type of environment to make long-range plans, and it's next to 
impossible to achieve the kind of cultural shift needed to 
reform the management of the Federal government.
    GPRA requires that agencies focus attention on program 
evaluation as one of six aspects of their strategic plans. 
Unfortunately, the Government Accountability Office 
reports(GAO-04-38) that program evaluation is the one area where 
departments consistently come up short. Not only have agencies failed 
to comply with this requirement, the valuable information that stands 
to be gained from these evaluations is not culled, coordinated, or 
presented in a useful way.
    By creating and using the Program Assessment Rating Tool, 
or PART, the Office of Management and Budget (OMB) has gone a 
step beyond the strategic plans required by GPRA and 
implemented a system for evaluating the performance and results 
of individual Federal programs. The next logical step is to 
codify the requirement for a coordinated evidence-based review 
of programs. Clearly, developing a better understanding of how 
government operates program by program is a good idea. As such, 
the PAR Act is necessary to ensure that program assessments be 
required for this and future Administrations.
    The PAR Act does not seek to codify the use of the PART 
specifically. Rather, the Act amends GPRA by establishing a 
requirement for program reviews. Specifically, the OMB is 
required under the Act to review each program activity at least 
once every five years. Requiring OMB to be responsible for 
overseeing program assessment data will be a great step forward 
in realizing the reforms envisioned by GPRA and will make the 
Federal government more efficient and results oriented.
    Information gleaned from these program reviews will be 
useful across the board to all stakeholders. Members of 
Congress, taxpayers, Federal managers and the Executive Branch 
need to know if programs are being managed effectively and if 
they are achieving the desired results. Further, the PAR Act 
will facilitate data comparisons among different programs and 
across agencies, to see how different programs with similar 
goals are achieving results. Members of Congress can use the 
information to make informed budget decisions and conduct more 
effective oversight. It will help the taxpayers see what they 
are getting for their money. Most important, Federal managers 
will use the information to improve the way they manage 
programs. The results will be a more effective and efficient 
government for the good of all Americans.

                          LEGISLATIVE HISTORY

    On February 25, 2004, Representative Todd R. Platts (R-PA), 
Chairman of the Subcommittee on Government Efficiency and 
Financial Management of the Committee on Government Reform, 
along with Representative Tom Davis (R-VA), Chairman of the 
Committee on Government Reform, introduced H.R. 3826, the 
``Program Assessment and Results Act'' to amend and improve the 
Government Performance and Results Act (GPRA) of 1993, P.L. 
103-62. The bill was subsequently referred to the Committee on 
Government Reform. The Committee on Government Reform then 
referred H.R. 3826 to the Subcommittee on Government Efficiency 
and Financial Management, which has jurisdiction over GPRA and 
all matters relating to the overall efficiency and management 
of government operations.
    On May 19, 2004, the Subcommittee on Government Efficiency 
and Financial Management held a business meeting to mark up 
H.R. 3826. Subcommittee Chairman Todd Platts (R-PA) offered an 
amendment in the nature of a substitute, which enhances 
coordination between OMB and the relevant agency in determining 
the programs to review, as well as enhances the transparency of 
the programmatic review report provided to Congress by ensuring 
that this report specifies (1) the performance goals for each 
program review, (2) the criteria used to evaluate, (3) the 
results of the evaluation, and (4) is available in electronic 
form through the OMB website. The amendment also provided for 
the termination of the review requirement as of September 30, 
2013, essentially after two complete review cycles have been 
completed. The amendment also made a number of other technical 
changes to the legislation. The amendment in the nature of a 
substitute was adopted by voice vote.
    The Subcommittee also adopted an amendment offered by Rep. 
Edolphus Towns (D-NY), which required the head of the Office of 
Management and Budget to provide notice and an opportunity for 
public comment in the Federal Register on a detailed 
description in draft form of each program to be assessed, the 
draft performance goals for each such program and the draft 
criteria used to evaluate each program. The amendment also 
called for the publication in the Federal Register of the final 
list of programs to be assessed, the final performance goals 
and final criteria used to evaluate, along with a summary of 
all public comment. This amendment was adopted by voice vote.
    H.R. 3826 was reported to the full Committee on Government 
Reform, as amended, by voice vote.
    On June 3, 2004 the full Committee on Government Reform 
held a business meeting to mark up H.R. 3826. Chairman Platts 
of the Subcommittee on Government Efficiency and Financial 
Management offered an amendment in the nature of a substitute 
which makes additional changes from the Manager's Amendment 
approved by the Subcommittee. Recognizing that this law places 
some additional burden on OMB and the agencies the amendment 
gives the OMB Director some latitude to exempt certain programs 
from the review requirement. This amendment also respects the 
privacy of classified information by excluding it from the 
reporting requirement.
    The amendment also made changes to the amendment adopted by 
the Subcommittee originally offered by Mr. Towns. Mr. Towns' 
amendment sought to ensure that stakeholders and others with an 
interest in the programs being assessed would have an 
opportunity to comment on the programs and the criteria used to 
assess them. While the amendment changed the language of the 
original amendment, it ensures that there is a provision 
providing for the publication of programs to be assessed and 
the criteria that will be used in those assessments. The 
Manager's Amendment, requires that this information be posted 
on the OMB web site at least 90 days prior to completion of the 
assessments and requires that the Director of OMB provide a 
mechanism for interested parties to comment. The Manager's 
Amendment was adopted by the committee by voice vote.
    Rep. Towns offered an amendment to the amendment in the 
nature of a substitute to restore the language of his amendment 
approved by the Subcommittee on GovernmentEfficiency and 
Financial Management. This amendment was defeated by a rollcall vote of 
15 ``nays'' and 9 ``yeas''.
    During the business meeting Rep. Waxman (D-CA) offered an 
amendment that required program reviews conducted pursuant to 
the bill to be performed by the heads of agencies, rather than 
by OMB. The amendment failed on a voice vote.
    Also during the business meeting, two amendments were 
offered by Rep. Van Hollen (D-MD) and subsequently withdrawn. 
Rep, Van Hollen offered an amendment that directed the 
functions and activities required by the bill to be classified 
as inherently governmental activities and an amendment that 
required the submission to Congress of any classified 
information as a result of the bill.
    H.R. 3826, as amended, was approved by voice vote and 
ordered reported favorably to the full House of Representatives 
for consideration.

                           Section-by-Section


                         SECTION 1--SHORT TITLE

    The Act may be cited as the ``Program Assessment and 
Results Act.''

                          SECTION 2--FINDINGS

    This section summarizes the findings of Congress with 
respect to the following: the lack of program performance 
information available to Federal managers and Congress for 
decision-making; the importance of performance information to 
making good managerial and budget decisions; and the foundation 
that the Government Performance and Results Act of 1993 (GPRA), 
P.L. 103-362, has laid for program performance reviews.

                           SECTION 3--PURPOSE

    This section states the purposes of the Act, which are: to 
amend and improve GPRA by implementing program reviews that 
determine the strength and weakness of Federal programs; to use 
the information gathered for the executive branch to make 
informed management decisions and evidence-based funding 
requests; and to provide Congress with information necessary to 
conduct more effective oversight, to make better-informed 
authorization decisions, and to make more evidence-based 
spending decisions.

                SECTION 4--PROGRAM REVIEW AND EVALUATION

    Paragraph (a) establishes a requirement for program reviews 
by amending chapter 11 of title 31, United States Code, as 
amended by GPRA.
    This amendment to GPRA adds ``Section 1120. Program review 
and evaluation.'' to the end of chapter 11 of title 31, United 
States Code. Paragraph (a) of the new section 1120 requires the 
Director of the Office of Management and Budget (OMB) to review 
each program activity at least once every 5 fiscal years.
    The bill as passed by the committee includes language 
stating that the Director of the Office of Management and 
Budget shall ``to the maximum extent practicable'' conduct a 
review of each program every five years. This language was 
included in the final version of H.R. 3826 to give minimal 
flexibility to the Director should a special circumstance arise 
where an assessment of a certain program is deemed unneeded. 
The clause, ``to the maximum extent practicable'' is not 
intended to give the Director wholesale flexibility or the 
ability to exempt any programs from review without a legitimate 
reason. Should the Director seek to exempt any program from 
this review requirement he shall notify the Congress, including 
the House Committee on Government Reform and Senate Committee 
on Governmental Affairs, in writing explaining the specific 
reasons why the review is deemed unneeded.
    Paragraph (b) of section 1120 requires the Director in 
conducting a review of a program activity to coordinate with 
the relevant agency and evaluate each program activity's 
purpose, design, strategic plan, management, results, and any 
other matters that the Director considers appropriate.
    Paragraph (c) of section 1120 requires the Director to 
develop criteria for deciding which program activities to 
review each fiscal year. It further instructs the Director to 
take into account the advantages of reviewing program 
activities with similar functions or purposes during the same 
fiscal year.
    Paragraph (d) of section 1120 requires the Director to make 
every effort to review program activities more frequently than 
every 5 fiscal years in cases in which programs are determined 
to be of higher priority, special circumstances exist, 
improvements have been made, or the head of the relevant agency 
and the Director determine that more frequent review is 
warranted.
    Paragraph (e) requires that at least 90 days prior to 
completing the assessments require under this section that the 
Director publish on the OMB website or successor website and 
provide to the House Committee on Government Reform and Senate 
Committee on Governmental Affairs a list of all programs to be 
assessed during a fiscal year and the criteria to be used in 
those assessments. This section further requires that OMB 
provide a formal mechanism for interested persons to comment on 
the programs being assessed and the criteria used to assess 
those programs.
    Paragraph (f) of section 1120 requires:
    (1) The Director to submit the results of the reviews for a 
fiscal year to the Congress along with the President's next 
budget following the end of the fiscal year in which the 
reviews were conducted;
    (2) Specifies the criteria that shall be required for the 
report.
    Paragraph (g) of section 1120:
    (1) Establishes provisions for the submission of program 
assessments containing classified information.
          (A) requires that a copy of the assessment (including 
        the classified information) be provided to the 
        appropriate committees of the House of Representatives 
        and the Senate, and
          (B) requires that, consistent with statutory law, an 
        appendix containing a list of each assessment 
        referenced in (A) be provided to the Committee on 
        Government Reform of the House of Representatives and 
        the Committee on Governmental Affairs of the Senate.
    (2) Establishes that upon request from the Committee on 
Government Reform of the House or the Committee on Governmental 
Affairs of the Senate, the Director of OMB shall provide to the 
requesting committee a copy of any assessment or appendix 
referenced in subparagraph (A) or (B) respectively.
    (3) Establishes that the term ``classified information'' 
refers to matters in section 552(b)(1)(A) of title 5 U.S.C.
    Paragraph (h) establishes that the functions and activities 
authorized by this section shall be considered inherently 
governmental functions and performed only by Federal employees.
    Paragraph (i) terminates the review requirement in 2013, 
essentially after two complete review cycles have been 
completed.
    Paragraph (b) of Section 4 provides that the Director shall 
have 6 months after the date of enactment of this Act to issued 
guidance to implement the requirements of section 1120.
    Paragraph (c) makes conforming amendments to Section 
1115(g) of title 31.

                SECTION 5--STRATEGIC PLANNING AMENDMENTS

    Paragraph (a) amends section 306 of title 5, United States 
Code, to change the date for submitting strategic plans as 
required under GPRA to September 30 of each year following a 
presidential election, beginning with September 30, 2005. This 
change in date makes the release of strategic plans correspond 
with the change in leadership from one Administration to the 
next.
    Paragraph (b) amends section 306 of title 5, United States 
Code, to change the period of coverage for strategic plans from 
five years to four years, again corresponding with a 
presidential term.

                       Explanation of Amendments

    The provisions of the substitute are explained in this 
report.

                        Committee Consideration

    On June 3, 2004, the Committee met in open session and 
ordered reported favorably the bill, H.R. 3826, as amended, by 
rollcall vote, a quorum being present.


              Application of Law to the Legislative Branch

    Section 102(b)(3) of Public Law 104-1 requires a 
description of the application of this bill to the legislative 
branch where the bill relates to the terms and conditions of 
employment or access to public services and accommodations. 
This bill improves the Government Performance and Results Act 
(GPRA) of 1993, P.L. 103-62, by implementing a program review 
and evaluation process that attempts to determine the strengths 
and weaknesses of Federal programs with a particular focus on 
the results produced by individual programs. As such this bill 
does not relate to employment or access to public services and 
accommodations.

  Statement of Oversight Findings and Recommendations of the Committee

    In compliance with clause 3(c)(1) of rule XIII and clause 
(2)(b)(1) of rule X of the Rules of the House of 
Representatives, the Committee's oversight findings and 
recommendations are reflected in the descriptive portions of 
this report.

         Statement of General Performance Goals and Objectives

    In accordance with clause 3(c)(4) of rule XIII of the Rules 
of the House of Representatives, the Committee's performance 
goals and objectives are reflected in the descriptive portions 
of this report.

                   Constitutional Authority Statement

    Under clause 3(d)(1) of rule XIII of the Rules of the House 
of Representatives, the Committee must include a statement 
citing the specific powers granted to Congress to enact the law 
proposed by H.R. 3826. Article I, Section 8, Clause 18 of the 
Constitution of the United States grants the Congress the power 
to enact this law.

                     Federal Advisory Committee Act

    The Committee finds that the legislation does not establish 
or authorize the establishment of an advisory committee within 
the definition of 5 U.S.C. App., Section 5(b).

                       Unfunded Mandate Statement

    Section 423 of the Congressional Budget and Impoundment 
Control Act (as amended by Section 101(a)(2) of the Unfunded 
Mandate Reform Act, P.L. 104-4) requires a statement whether 
the provisions of the reported include unfunded mandates. In 
compliance with this requirement the Committee has received a 
letter from the Congressional Budget Office included herein.

                           Committee Estimate

    Clause 3(d)(2) of rule XIII of the Rules of the House of 
Representatives requires an estimate and a comparison by the 
Committee of the costs that would be incurred in carrying out 
H.R. 3826. However, clause 3(d)(3)(B) of that rule provides 
that this requirement does not apply when the Committee has 
included in its report a timely submitted cost estimate of the 
bill prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act.

     Budget Authority and Congressional Budget Office Cost Estimate

    With respect to the requirements of clause 3(c)(2) of rule 
XIII of the Rules of the House of Representatives and section 
308(a) of the Congressional Budget Act of 1974 and with respect 
to requirements of clause (3)(c)(3) of rule XIII of the Rules 
of the House of Representatives and section 402 of the 
Congressional Budget Act of 1974, the Committee has received 
the following cost estimate for H.R. 3826 from the Director of 
Congressional Budget Office:

H.R. 3826--Program Assessment and Results Act

    H.R. 3826 would amend the Government Performance and 
Results Act of 1993 to require the Office of Management and 
Budget (OMB) to review, to the maximum extent practicable, each 
program activity in the federal government at least once every 
five years. The review would focus on the purpose, design, 
strategic plan, management, results, and other appropriate 
measures of each program. Results of these reviews would be 
submitted to the Congress. The authority to conduct these 
program reviews would expire on September 30, 2013. Finally, 
the bill would require agencies to submit comprehensive 
strategic plans to OMB by September 2005 instead of the 
following September.
    Most of the provisions of H.R. 3826 would codify and expand 
the current practices of OMB regarding federal program 
assessments. OMB currently reviews program performance through 
its Program Assessment Rating Tool (PART) which was developed 
to assess and improve program performance throughout the 
federal government. According to OMB, PART will be used to 
review 20 percent of all federal programs annually over the 
next five years. To the extent that reviews lead to improved 
program performance, subsequent legislation could change the 
cost of program operations.
    Based on information from OMB, CBO does not expect that 
changing the September 2006 due date for agencies' 
comprehensive strategic plans would require significant 
additional resources. Enacting the bill would not affect direct 
spending or revenues. H.R. 3826 contains no intergovernmental 
or private-sector mandates as defined in the Unfunded Mandates 
Reform Act and would not affect state, local, or tribal 
governments.
    The CBO staff contact for this estimate is Matthew 
Pickford. This estimate was approved by Peter H. Fontaine, 
Deputy Assistant Director for Budget Analysis.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

TITLE 31, UNITED STATES CODE

           *       *       *       *       *       *       *


Subtitle II--The Budget Process

           *       *       *       *       *       *       *


   CHAPTER 11--THE BUDGET AND FISCAL, BUDGET, AND PROGRAM INFORMATION

Sec.
1101.  Definitions.
     * * * * * * *
1120.  Program assessment.

           *       *       *       *       *       *       *


Sec. 1115. Performance plans

  (a) * * *

           *       *       *       *       *       *       *

  (g) For purposes of this section and sections 1116 through 
[1119] 1120, and sections 9703 and 9704 the term--
          (1) * * *

           *       *       *       *       *       *       *


Sec. 1120. Program assessment

  (a) Assessment.--The Director of the Office of Management and 
Budget to the maximum extent practicable shall conduct, jointly 
with agencies of the Federal Government, an assessment of each 
program at least once every 5 fiscal years.
  (b) Assessment Requirements.--In conducting an assessment of 
a program under subsection (a), the Director of the Office of 
Management and Budget and the head of the relevant agency 
shall--
          (1) coordinate to determine the programs to be 
        assessed; and
          (2) evaluate the purpose, design, strategic plan, 
        management, and results of the program, and such other 
        matters as the Director considers appropriate.
  (c) Criteria for Identifying Programs To Assess.--The 
Director of the Office of Management and Budget shall develop 
criteria for identifying programs to be assessed each fiscal 
year. In developing the criteria, the Director shall take into 
account the advantages of assessing during the same fiscal year 
any programs that are performing similar functions, have 
similar purposes, or share common goals, such as those 
contained in strategic plans under section 306 of title 5. To 
the maximum extent possible, the Director shall assess a 
representative sample of Federal spending each fiscal year.
  (d) Criteria for More Frequent Assessments.--The Director of 
the Office of Management and Budget shall make every effort to 
assess programs more frequently than required under subsection 
(a) in cases in which programs are determined to be of higher 
priority, special circumstances exist, improvements have been 
made, or the head of the relevant agency and the Director 
determine that more frequent assessment is warranted.
  (e) Publication.--At least 90 days before completing the 
assessments under this section to be conducted during a fiscal 
year, the Director of the Office of Management and Budget 
shall--
          (1) make available in electronic form through the 
        Office of Management and Budget website or any 
        successor website, and provide to the Committee on 
        Government Reform of the House of Representatives and 
        the Committee on Governmental Affairs of the Senate--
                  (A) a list of the programs to be assessed 
                during that fiscal year; and
                  (B) the criteria that will be used to assess 
                the programs; and
          (2) provide a mechanism for interested persons to 
        comment on the programs being assessed and the criteria 
        that will be used to assess the programs.
  (f) Report.--(1) The results of the assessments conducted 
during a fiscal year shall be submitted in a report to Congress 
at the same time that the President submits the next budget 
under section 1105 of this title after the end of that fiscal 
year.
  (2) The report shall--
          (A) include the performance goals for each program 
        assessment;
          (B) specify the criteria used for each assessment;
          (C) describe the results of each assessment, 
        including any significant limitation in the 
        assessments;
          (D) describe significant modifications to the Federal 
        Government performance plan required under section 
        1105(a)(28) of this title made as a result of the 
        assessments; and
          (E) be available in electronic form through the 
        Office of Management and Budget website or any 
        successor website.
  (g) Classified Information.--(1) With respect to program 
assessments conducted during a fiscal year that contain 
classified information, the President shall submit on the same 
date as the report is submitted under subsection (f)--
          (A) a copy of each such assessment (including the 
        classified information), to the appropriate committees 
        of jurisdiction of the House of Representatives and the 
        Senate; and
          (B) consistent with statutory law governing the 
        disclosure of classified information, an appendix 
        containing a list of each such assessment and the 
        committees to which a copy of the assessment was 
        submitted under subparagraph (A), to the Committee on 
        Government Reform of the House of Representatives and 
        the Committee on Governmental Affairs of the Senate.
  (2) Upon request from the Committee on Government Reform of 
the House of Representatives or the Committee on Governmental 
Affairs of the Senate, the Director of the Office of Management 
and Budget shall, consistent with statutory law governing the 
disclosure of classified information, provide to the Committee 
a copy of--
          (A) any assessment described in subparagraph (A) of 
        paragraph (1) (including any assessment not listed in 
        any appendix submitted under subparagraph (B) of such 
        paragraph); and
          (B) any appendix described in subparagraph (B) of 
        paragraph (1).
  (3) In this subsection, the term ``classified information'' 
refers to matters described in section 552(b)(1)(A) of title 5.
  (h) Inherently Governmental Functions.--The functions and 
activities authorized or required by this section shall be 
considered inherently Governmental functions and shall be 
performed only by Federal employees.
  (i) Termination.--This section shall not be in effect after 
September 30, 2013.

           *       *       *       *       *       *       *

                              ----------                              


               SECTION 306 OF TITLE 5, UNITED STATES CODE

Sec. 306. Strategic plans

  (a) [No later than September 30, 1997,] Not later than 
September 30 of each year following a year in which an election 
for President occurs, beginning with September 30, 2005, the 
head of each agency shall submit to the Director of the Office 
of Management and Budget and to the Congress a strategic plan 
for program activities. Such plan shall contain--
          (1) * * *

           *       *       *       *       *       *       *

  [(b) The strategic plan shall cover a period of not less than 
five years forward from the fiscal year in which it is 
submitted. The strategic plan shall be updated and revised at 
least every three years, except that the strategic plan for the 
Department of Defense shall be updated and revised at least 
every four years.]
  (b) Each strategic plan shall cover the 4-year period 
beginning on October 1 of the year following a year in which an 
election for President occurs.

           *       *       *       *       *       *       *


                             MINORITY VIEWS

    H.R. 3826, the Program Assessment and Results Act (PARA), 
would require every federal program to be reviewed or evaluated 
at least once every five years. We support the concept of 
programmatic reviews. However, as drafted, this bill allows the 
program review process to be politicized. In addition, the bill 
fails to ensure adequate public participation.
    During full Committee markup, we proposed amendments to 
PARA addressing these two fundamental flaws. An amendment by 
Rep. Henry A. Waxman would have required agencies, and not the 
partisan Office of Management and Budget (OMB), to perform the 
bill's required program assessments. An amendment by Rep. Ed 
Towns would have enhanced transparency by requiring a notice 
and comment process prior to the conducting of assessments. 
Because these two amendments were rejected, we cannot support 
PARA as it passed out of full Committee.

    THERE IS NO ROOM FOR POLITICS IN THE PROGRAM ASSESSMENT PROCESS

    PARA expands on the requirements of the Government 
Performance and Results Act (GPRA). GPRA requires agencies to 
set annual goals and measure their performance in achieving 
those goals. PARA adds a periodic five-year review to provide a 
detailed analysis at the individual program level.
    As drafted, this bill deviates from GPRA in one significant 
respect. Instead of requiring agencies to set performance goals 
and evaluate the performance of their programs, PARA requires 
the White House, through the OMB, to pick the criteria and 
evaluate performance. The Waxman amendment sought to fix this 
problem.
    We already have seen the problems that occur when OMB 
reviews programs. Over the last three years, OMB has created 
and used a process known as the Program Assessment Rating Tool, 
or PART, to review selected activities at the program level. 
That process has lead to questionable ratings for a number of 
programs.
    Some programs, such as HOPE VI and Even Start, have 
received poor ratings despite their success. In addition, OMB 
created a rating called ``Results Not Demonstrated'' which it 
uses when it is unable to properly measure a program. Under the 
PART, 37.1%, or 152 out of 407 programs rated, received this 
rating. The ``Results Not Demonstrated'' rating implies that 
the program is poorly managed or inadequate for meeting its 
goals. This is unfair because agencies are often managing 
programs under different criteria than under PART. Thus, the 
designation of ``Results Not Demonstrated'' is mostly due to 
the unknown effectiveness of a program, as opposed to its 
ineffectiveness.
    Congress should not codify this current practice. 
Congressional intent in authorizing and funding government 
activities should be faithfully carried out. This bill would 
have the effect of shifting power from Congress to the White 
House to direct and evaluate agency activities. Congress 
expresses its priorities through statutes authorizing agency 
activities. But OMB doesn't implement those statutes. OMB 
implements the priorities of the White House. In fact, many 
agencies, and especially those charged with protecting public 
health, worker safety, and the environment, view OMB as hostile 
to the agencies' fundamental missions. This bill actually 
encourages OMB to infringe on Congress' prerogatives.

     PUBLIC PARTICIPATION IS KEY TO SUCCESSFUL PROGRAM ASSESSMENTS

    PARA fails to provide adequately for public input into how 
programs should be evaluated. The Towns amendment sought to 
address this deficiency. The amendment provides a period for 
public notice and comment on which programs will be reviewed, 
and what criteria will be used to review them. That's all. It 
doesn't require OMB or agencies to accept those comments, or 
modify their plans in any way. It simply creates a forum for 
public comment. This process is used all the time in many rule-
making activities and is an appropriate parallel to the 
Government Performance and Results Act's requirement for input 
from stakeholders when developing strategic plans.
    This amendment has already been agreed to once at the 
Subcommittee level. In a departure from customary practice, it 
was taken out and replaced with the vague and much weaker 
language in the manager's amendment at the full Committee, 
which leaves to OMB the determination of what is an 
``appropriate mechanism for public input.'' Given this 
Administration's record on secrecy, this approach seems absurd.

                              OTHER ISSUES

    During full Committee markup, two amendments were offered, 
and then withdrawn, by Rep. Chris Van Hollen. Mr. Van Hollen's 
first amendment required that federal employees perform all 
program assessments and other requirements of PARA. This 
language tracks GPRA and is important to ensure that this 
inherently governmental work is not contracted out. The 
majority has agreed to include this Van Hollen language in the 
bill as it is brought to the House floor.
    Mr. Van Hollen's second amendment amended the provision of 
PARA that required OMB to produce program assessment reports. 
That provision of PARA stated that classified information could 
not be part of those reports. Mr. Van Hollen's amendment 
required that classified information regarding program 
assessments be available, but as a classified appendix to the 
reports. It is imperative that Congress be apprised of the 
performance of programs that deal with classified information. 
Although it is necessary to ensure that classified information 
is not placed in the public domain, it should be available to 
Congress. The majority also has agreed to include language in 
the bill ensuring Congress has access to classified information 
regarding program assessments.
    Finally, during Subcommittee consideration of the bill, we 
were pleased that a number of provisions were added to PARA, 
which were not part of the introduced bill. Those provisions 
include language on transparency, diversification of program 
assessments to ensure that both domestic and defense/homeland 
security programs were being assessed each year, enhanced 
coordination between OMB and agencies, and sunsetting the 
bill's requirements.

                                   Henry A. Waxman.
                                   Edolphus Towns.
                                   Carolyn B. Maloney.
                                   Danny K. Davis.
                                   Diane E. Watson.
                                   Jim Cooper.
                                   Major R. Owens.
                                   Paul E. Kanjorski.
                                   Elijah E. Cummings.
                                   Wm. Lacy Clay.
                                   Linda T. Sanchez.
                                   Betty McCollum.

                                  
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